DATE: 20050331

DOCKET: M32309, M32339 (C42369)

COURT OF APPEAL FOR ONTARIO

RE:

CANADA POST CORPORATION, Respondent (Respondent on Appeal) - and - KEY MAIL CANADA INC. and KEY MAIL INTERNATIONAL INC., Respondents (Appellants on Appeal)

BEFORE:

MCMURTRY C.J.O. (IN CHAMBERS)

COUNSEL:

Brian Gover

for the Moving Party/Intervenor, G3 World wide (Canada ) Inc., c.o.b. Spring Canada

R. David House

for the Moving Party/Intervenor, Citicourier International Inc.

Brian M. Jenkins

for the Respondents/Appellants in Appeal, Key Mail Canada Inc. and Key Mail International Inc.

Howard W. Winkler, Eric Wredenhagen, Sean Kennedy

for the Respondents/Respondent in Appeal, Canada Post Corporation

HEARD:

March 31, 2005

E N D O R S E M E N T

[1] Citicourier International Inc. (“CITICOURIER”) and G3 Worldwide (Canada) c.o.b. Spring Canada (“SPRING CANADA”) seek to intervene as either parties or friends of the court in the appeal brought by Key Mail Canada Inc. and Key Mail International Inc. (“KEY MAIL”) from a decision of Carnwath J. made in the course of its litigation with Canada Post Corporation (“CANADA POST”).

[2] CANADA POST operates a Postal Service in Canada including dealing with letters addressed to foreign destinations. KEY MAIL, the appellant, and CITICOURIER and SPRING CANADA, the proposed intervenors, are competitors in relation to that part of the business known as “outbound international mail”. Both proposed intervenors have engaged in this business for many years.

[3] The appeal is from a brief decision rendered by Carnwath J. on a Rule 21 motion brought in the underlying proceedings between CANADA POST and KEY MAIL. That motion was brought by CANADA POST seeking a determination of a question of law regarding the interpretation of Section 14 of the Canada Post Corporation Act. Section 14 (1) of the Act provides as follows: “Subject to Section 15, the Corporation has the sole and exclusive privilege of collecting, transmitting and delivering letters to the addressee thereof within Canada.”

[4] Justice Carnwath ruled that this provision gave CANADA POST exclusive rights in respect of the “outbound international mail” component of its business. If this interpretation is correct, it would significantly affect the viability of the appellant and the proposed intervenors to conduct this business.

[5] Justice Carnwath declined to accept evidence to explain or contextualize the history between the parties, the nature of the “outbound international mail” business generally and the conduct of CANADA POST in particular, ruling that such was irrelevant to his determination of the legal question as to the proper interpretation of Section 14. His refusal to accept extrinsic evidence or adjourn the motion for an evidentiary hearing is one of the grounds of appeal.

[6] Each of the two proposed intervenors is subject to proceedings in other courts brought by CANADA POST seeking to enjoin them from conducting business in the “outbound international mail” industry. In both proceedings, it appears that CANADA POST has relied upon the decision of Justice Carnwath to support its claim that CITICOURIER and SPRING CANADA are infringing its exclusive privilege to engage in this business.

[7] Potential intervenors may seek to intervene as added parties or as a "friend of the court". Typically, the applicant in a motion for intervention seeks to be added as a "friend of the court" on the basis that, while not directly involved in the matter in dispute, it does have an interest and expertise in the subject area so that it can "make a useful contribution to the resolution of the appeal without causing injustice to the immediate parties": Peel (Regional Municipality) v. Great Atlantic & Pacific Co. of Canada Ltd. (1990), 1990 6886 (ON CA), 74 O.R. (2d) 164 CA at page 167. Most of the jurisprudence has dealt with applications for intervenor status from the perspective of the "friend of the court". Because of the specific criteria set out in Rule 13.01, applications to be added as parties are less common. However, in my view, if a proposed intervenor meets one or more of the criteria to be added as a party as set out in Rule 13.01 (1), this factor must be added to the considerations set out in Peel (supra) in determining whether it would be fair and just to add the intervenor as a party to the proceedings. Certainly, a proposed intervenor that meets one of these criteria has a more "immediate interest" in the particular proceedings than the typical "friend of the court". See for example: Saylor v. Brooks[2005] O.J. No. 15 Docket: M32036 (C41921); Grey Assn. for Better Planning v. Artemesia Waters Ltd. [2003] O.J. No. 3539 Docket Nos. M30321 (C39869) and Stelco v. Ontario (Superintendent of Pensions for Ontario), 1995 Ont. C.A. M15954

[8] While neither of the applicants are involved in the particular proceeding involving KEY MAIL and are therefore not, strictly speaking, interested “in the subject matter of the proceeding”(Rule 13.01(1)(a)), both may “be adversely affected by a judgment in the proceeding”(Rule 13.01(1) (b)) and, in my view, there exists between proposed intervenors and CANADA POST “a question of law or fact in common with one or more of the questions in issue in the proceeding” (Rule 13.01(1)(c)). As such, I find both applicants stand in a position similar to that of Imperial Oil in Stelco (supra). As stated by Dubin C.J.O. in Stelco:

I am particularly moved in arriving at that decision by reason of the pending proceedings before the Pension Commission of Ontario relating to the proposed order to wind up Imperial's Retirement Plan (1998) and Imperial's Retirement Plan for Former Employees of McColl-Frontenac,

It would appear from the supplementary motion record that the judgment of the court in the Stelco appeal may have a direct bearing in the proceedings pending before the Pension Commission.

In my opinion the applicant has an interest in the subject matter of the Stelco appeal and may be adversely affected by the judgment in that appeal.

It would appear that there are common issues with respect to Stelco's retirement plans and Imperial’s retirement plans. Under such circumstances, if Imperial is to be granted leave to intervene, it should be granted leave to intervene as an added party and thus be bound by the judgment of the court in the Stelco appeal.

In the result, I would grant Imperial leave to intervene as an added partly.

[9] Similarly, I find that CITICOURIER and SPRING CANADA have an interest sufficient to justify adding them as parties to this appeal. They have a more immediate interest in the proceedings than others who might simply be affected by the principle of stare decisis. I am also satisfied that they can contribute to the argument of the appeal and assist the court in dealing with the complexities of the correct principles of statutory interpretation to be applied to the legislation in question.

[10] CITICOURIER and SPRING CANADA each seek leave to introduce evidence as to the history of the “outbound international mail” industry, the international context within which this industry operates, the business practices of CANADA POST generally and in relation to this market in particular, and the manner in which it has sought to enforce its “exclusive privilege” under Section 14. As a party to the proceedings, each would have the right to seek to introduce "fresh evidence" on the appeal. However this right is subject to the imposition, as a condition of intervention, of limitations on the intervention.

[11] It appears that in its proceedings with CANADA POST, CITICOURIER has raised the constitutionality of some of the provisions of the Act. The constitutionality of Section 14 was not raised in the proceedings before Carnwath J. and it would be an expansion of the lis to consider constitutional issues for the first time on appeal. If the constitutionality of the legislation is to be determined, that should occur in the lower court first with a proper record. Accordingly, as a condition of intervention, I direct that the constitutionality of the legislation may not be raised on this appeal by the intervenor.

[12] In the Stelco case (supra), Dubin C.J.O. permitted the intervenor to augment the record to provide context for its argument. In this case, the intervenors may add to the record information as set out in paragraphs 61(a), (b), (c) and (d) of the draft factum submitted by SPRING CANADA. The respondent is at liberty to file responding material on these issues as well. If this necessitates an adjournment of the appeal, scheduled for hearing on April 15, 2005, I direct that it be rescheduled for hearing on an expedited basis. Additionally, while I grant leave to the intervenors to augment the record with information as set out above, I make no comment as to the use that the panel hearing the appeal might make of it. It may well be that the panel might not consider this information to be admissible or relevant to its deliberations.

[13] SPRING CANADA may file a factum of up to 24 pages in length. CITICOURIER may file a factum of up to 10 pages in length. Both intervenors shall have up to 30 minutes for oral argument. The intervenors shall not duplicate the written or oral argument of the other parties. Both intervenors shall not seek costs but may be liable to costs in the discretion of the court.

[14] There shall be no costs of this motion.

“R. Roy McMurtry C.J.O.”